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J.C. Penney also said it “no longer anticipates achieving the previously issued non-GAAP earnings guidance” for fiscal 2012, but said the company expects to end the year with at least $1 billion of cash on the balance sheet even after spending $800 million on the restructuring.

Shares of J.C. Penney soared more than 9% premarket to $24.

The company’s selling, general and administrative expenses declined by $193 million and the company said that while the transition will take time, JC Penney “will stay the course.”

“We have now completed the first six months of our transformation and while business continues to be softer than anticipated, we are confident the transformation of jcpenney is on track,” Johnson said in a statement.

However, investors have remained skeptical that the company will be able to make enough changes to navigate successfully through the key holiday season.

While J.C. Penney in February eliminated the use of coupons and discounts and started running under campaign of "everyday low prices," it continues to bleed customers, leading to its second straight quarter of steep sales declines.